Navigating Australian admiralty law: The ability to claim against and arrest a ship in Australian waters

In an era where shipping has become integral to the success of many businesses, claims arising in connection with the use or deployment of a ship or the business of its owner or charterer are becoming increasingly commonplace. In this article Corrs Partner, Ian Dallen, examines the ability of an aggrieved party to pursue the unique and powerful admiralty law remedy of recovering their loss and damage via an action in rem against a ship.

Shipping is the cornerstone of world trade with tankers, bulk carriers and container ships carrying billions of tonnes of goods & commodities between countries each year. Australia, as one of the world's most resource-rich countries and an island continent, is heavily dependent upon shipping for the movement of goods & commodities, with a large proportion of its exports comprising dry bulk commodities (such as mineral ores and coal) carried by sea. Indeed, almost all of Australia's export trade and around ¼ of its domestic trade is carried by sea.

Whilst shipping is a vital element of the Australian economy, the vast majority of ships carrying goods & commodities to / from and around Australia are foreign owned and, in many cases, the ship itself (when in Australian waters) is the only readily accessible asset within Australia which can be used to secure a claim arising in connection with the use or deployment of the ship or the business of the ship's owner or charterer.

PURSUING A CLAIM AGAINST A SHIP IN AUSTRALIA: AN ACTION IN REM

The pursuit of a claim against a ship (as opposed to against an individual or company) is a powerful and unique remedy recognised internationally by admiralty law. This is known as an action in rem (ie an action against property) and, in Australia, it is only available where the claim falls within the ambit of the Admiralty Act 1988 (Cth) (the Act).1 An action in rem involves a party commencing proceedings against a ship and allows that party to have the ship arrested before their claim is heard. Further, once the claim is heard and determined, the ship can be sold by order of the court to satisfy the judgment.2

Section 10 of the Act confers jurisdiction to hear and determine in rem proceedings on the Federal Court of Australia and the Supreme Courts of each Australian State and Territory.3 However, in practice, the Federal Court has become the main forum for in rem proceedings in Australia.

THE TYPES OF CLAIMS THAT CAN BE PURSUED AGAINST A SHIP IN AUSTRALIA

A party can commence an action in rem against a ship in Australia in respect of the following claims:

a 'maritime lien or other charge' in respect of the ship (a maritime lien includes a lien for salvage, damage done by a ship, wages of the master & crew and the master's disbursements);4 a 'proprietary maritime claim' in respect of the ship (being either: a claim relating to the possession, title...